Are you holding the right altcoins?

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As a seasoned crypto investor with a few battle scars from past investments, I can’t help but feel a sense of caution when it comes to altcoins in the market. The allure of new and innovative projects is undeniable, but the reality is that the vast majority of them are just not worth holding onto.

Among the diverse range of cryptocurrencies outside Bitcoin, many altcoins and tokens lack value and exist primarily to deceive unsuspecting investors. Yet, it’s important to note that some top-ranked altcoins by market capitalization may not be worth holding despite their popularity. Do any of these questionable investments make up your portfolio?

You are responsible for your own investments

As a crypto investor, I can’t stress enough that when it comes to investing in altcoins, the ultimate decision lies with me. While government watchdog agencies may suggest consulting a financial advisor, keep in mind that most of these professionals are rooted in the traditional financial system and might not possess the necessary knowledge about buying cryptocurrencies. In fact, they could advise against it due to their lack of understanding.

In plain terms, this guidance could potentially prevent numerous naive investors, especially those drawn to glitzy cryptocurrencies endorsed by famous influencers, from making costly mistakes.

Some groundbreaking crypto initiatives are creating unique spaces, and if the regulatory landscape improves and encourages these advancements, the crypto industry is poised for significant growth.

Large market cap cryptos that don’t perform

Despite our focus on crypto initiatives where numerous investors own the coins or tokens, it’s important to note that some of these projects continue to hold positions in the top 20 cryptocurrencies based on market capitalization.

As an analyst, I’ve observed that certain individuals possess widely recognized names, and their respective fan bases are notoriously sizable and fiercely dedicated to their idols. Yet, it’s essential to ponder the underlying reasons behind this phenomenon.

As a researcher studying the crypto market, I’ve observed that certain cryptocurrencies tend to experience price increases during bull markets. However, when the market takes a downturn, these specific cryptos often suffer larger losses than their top-performing counterparts. Furthermore, they struggle to match the consistent gains of those cryptos that regularly excel in uptrends.

Comparisons with Bitcoin

As a researcher studying the crypto market, I would recommend assessing a cryptocurrency’s performance by comparing it to Bitcoin, the largest and most dominant cryptocurrency in the market. This comparison will help determine if the crypto under consideration is underperforming relative to Bitcoin.

In a bull market, if your cryptocurrency fails to surpass Bitcoin’s performance over an extended duration, there might be little reason for keeping it in your portfolio.

Two of the crypto zombies

As a cryptocurrency analyst, I’d put forth that XRP presently occupies the 8th position in the crypto market cap rankings, boasting a value of approximately $24.4 billion. However, over the past year, it has experienced a 6.5% decline against the US dollar – a notable setback even within a thriving bull market. In comparison to Bitcoin (BTC), XRP’s performance is even more dismal, with a staggering 97% decrease. If we were to evaluate this in the context of traditional stock markets, it would be categorized as a ‘zombie’ company.

As a researcher studying the cryptocurrency market, I’ve observed that Cardano ($ADA) mirrors an unpromising scenario. Over the past year, it has plummeted by 93.4% relative to Bitcoin ($BTC), making it highly unlikely for this digital asset to regain ground anywhere near its previous peaks.

An investor strongly committed to cryptocurrencies like Ripple‘s XRP or Cardano’s ADA might argue that forming a partnership with a sovereign state or a major corporation listed in the S&P 500 index could lead to significant price growth for their holdings.

As a analyst, I would admit that it’s impossible to completely dismiss this possibility at this point in time. However, why not consider seizing the moment and investing in Bitcoin or other promising cryptocurrencies instead? After all, these digital currencies have demonstrated superior performance compared to Bitcoin.

The necessity of making at least 12% to 14% each year

As a researcher studying the crypto market, I would argue that the primary objective is to achieve an annual return of around 12% to 14% in order to counteract the effects of fiat currency depreciation due to inflation, not to mention taxes and other expenses.

As a researcher, I want to clarify that the information provided in this context does not constitute financial advice. I don’t have the necessary credentials to suggest any investment strategies or specific cryptocurrencies for you to buy and hold. My role is limited to presenting facts. So, I humbly ask: Which altcoins are you currently holding? It’s essential for each individual to make informed decisions based on their own research and risk tolerance.

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2024-07-10 12:05